Facebook Inc, Google Inc Will Capture 15% Of Total Ad Market By 2016

Facebook (NASDAQ:FB) and Google (NASDAQ:GOOG) (NASDAQ:GOOGL) will together make for 15% share of the total media advertising marketing of $200 billion in 2016, according to the latest report from eMarketer. In the United States, average daily time spent on mobile will surge two hours and 51 minutes in 2014, from two hours and 19 minutes last year, according to the report.

Ad spending rising on mobile

The research firm notes that the mobile ads on Facebook would account for 68% of the company’s ad revenue in the United States for 2014, an increase from 47% in the previous year. For Google, the percentage will rise to 36.8% in 2014 and 65.8% in 2016.

eMarketers revealed some other interesting facts like total U.S. ad market would increase 5.3% in 2014 to $180.12 billion, which is the first rise of over 5% since 2004. Also, advertisers will shell out 83% more on tablets and smartphones in 2014 compared to 2013. The report, further, noted that Ad spending on mobile will be more compared to that of the newspaper, magazines, and radio for the first time in 2014.

Rising competition, Facebook still dominates

Previously, Sterne Agee and Leach analysts noted that Facebook is becoming increasingly relevant for direct response advertisers on the back of enhanced targeting as well as more efficiency in measuring and showing strong return on investment for advertisers. The analysts stated that the price per ad will continue to increase. Additionally, complaints from advertisers for decreasing organic reach converting to increased costs per impressions for paid reach, also, proves this point.

According to the analysts, in 2013 around 250 million mobile apps were installed, and the same would increase to 500 million in 2014. The analysts, also, noted that the competition is thickening in the segment with companies such as Google, Twitter, AOL and Yahoo entering the space. Even then Facebook is dominating the space. Facebook is, also, focusing on the Video Ads, and has stated that it would like to see how consumers react to auto-play videos before entering with full force into the segment.

Another positive development is that Facebook has started tracking consumer activity on the wider web. Also, the Social networking company entered into $500 million deal with the Publicis Groupe of Paris, which further reflects positive sign and strong endorsement for the Facebook platform.